Financial Services for a Sustainable Local Economy

Local Business, Credit Unions, Galway Enterprise Board, Chamber of Commerce, Local and National Policymakers

Local individuals, enterprises and organisations need to be able to access funding to help finance the great transition to a sustainable local economy. There are various financial institutions and mechanisms that could aid this transition. These include:

Greener Credit Unions
Credit Unions are by their nature rooted in the locality but there needs to be a renewed emphasis on loans that support local sustainability. Credit Unions could promote loans for local green/sustainable projects such as home energy upgrades (insulation and renewable energy installations, etc.); small local green businesses; local environmental organisations, etc.

Co-operatives
A co-operative (co-op) is an enterprise or business association that is owned and controlled by its members. They are democratic in structure and give as much emphasis to sustainability and community building as to the generation of profits and/or benefits to their members. A co-op is significantly different from other forms of companies in a way that makes it the ideal choice of business structure for community-based projects. Examples of co-ops that would enable sustainability include: local energy co-ops, organic food co-ops, and sustainable housing co-ops.

Green Energy Bonds
These are similar to ordinary bonds (i.e. a debt security, under which the issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay them interest and/or to repay the principal at a later date). The difference is that green energy bonds are issued by banks, companies or the Government to finance clean energy projects.

Green Banking
This would involve all sectors of Irish or international banking (retail, investment, commercial, wholesale, etc.) that operate in Galway lending for projects that are environmentally sound. It would mean considering the triple bottom line (i.e. the environmental, social and financial aspects of a loan) as financial institutions such as Triodos Bank already do.

A New Galway Bank
A local public bank could be established that would focus on the local market. This bank would lend only for local projects that enhance the environmental sustainability of the Galway region. This bank could be owned by the local authority. Local public banking is very successful in Germany in the form of the Sparkasse banks.